The Fibonacci sequence is one of the most famous formulas in mathematics. Each number of the sequence is the sum of the two numbers that precede it. So the sequence goes: 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, and so on. It’s been called “nature’s secret code”, and ” natures universal rule”. Just take a look at the pattern it creates and you can instantly recognize how this sequence works in nature like an underlying universal grid. A perfect example of this is the Nautilus shell, whose chambers adhere to the Fibonacci sequence’s logarithmic spiral almost perfectly. This famous pattern shows up almost everywhere in nature including flowers, pinecones, hurricanes and even huge spiral galaxies in space. (Jonathan Cleveland Sept. 20, 2020)
The Fibonacci sequence can be applied to nature, to design, to the stock market, as we have read about how cryptocurrencies use technical analysis that follow the Fibonacci ratios.
What is the key to Fibonacci ratio of:
(a) 61.8% ratio is found by dividing one number in the series by the number that follows it. For example. 21 divided by 34 equals 0.6176, and 55 divided by 8 equals about 0.61798.
(b) the 38.2 % ratio is discovered by dividing a number in the series by the number located two spots to the right. For instance, 55 divided by 144 equals approximately 0.38194.
(c) the 23.6% ratio is divided by dividing a number in the series by the number located three spaced to the right. For example, 8 divided by 34 equals about 0.23529.
Each term in this sequence is simply the sum of the two preceding terms, and the sequence continues infinitely. One of the remarkable characteristics of this numerical sequence is that each number is approximately 1.618 times greater than the preceding number. This common relationship between each number in the series is the foundation of the ratios used by technical traders to determine retracement levels.
Learning about new things keeps your mind sharp, your conversation interesting plus builds a happier character so pull out your calculator, pen and paper and learn how nature, the stock market and world around us uses this magic formula. It carries beauty and knowledge. Thanks for reading.
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